NCLH unveils huge fleet expansion project

2024-04-14T15:19:06+00:00 April 14th, 2024|Ships|

Norwegian Cruise Line Holdings (NCLH) has unveiled the most comprehensive newbuilding project in its history.

NCLH has ordered eight cruise ships, representing nearly 25,000 additional berths, which will include new classes of ships for each of its brands.

In addition, the company will construct a multi-ship pier at Great Stirrup Cay, the company’s private island destination in the Bahamas.

The company explained that this unprecedented decade-long strategy will enhance its product offering, guest experiences, and operational infrastructure.

The new ship orders across the three brands are scheduled for delivery over a 10-year period, between 2026 and 2036.

Following the delivery of four ‘Prima-Plus’ class ships from 2025 through 2028, Norwegian Cruise Line  (NCL) is expected to take delivery of four circa 200,000 gt ships, each with a capacity of nearly 5,000 guests, in 2030, 2032, 2034 and 2036, which are still subject to financing and are at the Letter of Intent (LoI) stage.

Building on the success of its ‘Allura’ class ships, the last of which will be delivered in 2025, Oceania Cruises is scheduled to take delivery of two 86,000 gt ships, each with a capacity of 1,450 guests in 2027 and 2029.

Lastly, following the ‘Explorer’ class ships, Regent Seven Seas Cruises is scheduled to take delivery of two 77,000 gt ships, each with a capacity of 850 guests, in 2026 and 2029.

Details regarding the ships’ amenities, staterooms, dining, recreational, efficiency, sustainability and other features will be announced in the coming months.

“This strategic new ship order across all three of our award-winning brands provides for the steady introduction of cutting-edge vessels into our fleet and solidifies our long-term growth. It also allows us to significantly leverage our operating scale, strengthen our commitment to innovation and enhance our ability to offer our guests new products and experiences, all while providing opportunities to enhance the efficiency of our fleet,” said Harry Sommer, NCLH President and CEO (pictured).

“We are likewise excited with the addition of a new pier at Great Stirrup Cay to support our increased capacity in the Caribbean and multiple ships to call on the island, enhancing our guest experience and bringing seamless and reliable access to our private island year-round,” he added.

In partnership with the Italian shipbuilder, Fincantieri, each brand will design its new ship class and focus on creating the largest, most efficient, and innovative vessels of their respective fleet.

Aligning with the company’s sustainability efforts, the new ship designs are expected to advance the journey towards de-carbonisation.

“Over the years, our long-standing relationship with Norwegian Cruise Line Holdings has been rooted in a shared vision for the future of maritime travel, consistently setting new standards for innovation, luxury, sustainability, and guest satisfaction in the cruise industry,” said Pierroberto Folgiero, Fincantieri CEO and Managing Director.

“We are thrilled to work on these newbuild orders and deliver emblematic cruise ships that will embody our shared legacy of excellence for generations to come.”

NCLH confirmed that it had obtained export credit financing with favourable terms to fund 80% of the contract price of each of the two Oceania Cruises and Regent Seven Seas Cruises ships, subject to certain conditions.

The NCL orders remain subject to financing, which is currently underway.

NCLH’s CFO, Mark Kempa, commented; “We expect that these strategic investments will secure our growth trajectory, significantly boost our earnings profile, and enhance shareholder value well into the future.

“With a favourable payment structure that includes pre-delivery financing and modest initial instalment payments for these ship orders, we still anticipate strong net leverage reduction of 1.5 turns by the end of 2024, relative to 2023, and expect the company to continue reducing net leverage each year for the foreseeable future,” he said.

NCLH further explained that it expected the four-ship NCL order to replace a separate, two-ship order for Oceania Cruises initially placed to secure availability at the shipyard.

This order is still being finalised and is subject to financing. Delivery of the second Oceania Cruises ship is contractually scheduled for the fourth quarter of 2028, but may be delayed to 2029.

All of the expected delivery dates are preliminary and subject to change.

The new pier development at the company’s private island in the Bahamas, Great Stirrup Cay, is due to break ground this summer and be completed by late 2025 with an investment of around $150 mill.

It will be constructed to simultaneously accommodate two large vessels of NCLH’s current and future ship classes.